Refinancing surges in December: AFG

The proportion of borrowers refinancing has jumped to 37.3% of all new mortgages written in December, according to the AFG Mortgage Index.

The Index shows the proportion of home loan borrowers refinancing over the month was the highest level since that recorded in March 2012.

The last quarter of 2014 saw an increase from 33.5% refinanced in September by 3.8%.

Those opting for fixed rates fell to 14.5%, down from 17.1% in November.

The proportion of introductory loans jumped from 4.9% in November by 0.9% to the December month. These are incentivising products offered by lenders.

AFG’s general manager of sales and operations, Mark Hewitt, said that in March 2012, when we last saw refinancing at these highs, borrowers were looking to fix, with fixed interest loans at a four year high.

“This time round with speculation that interest rates are more likely to go down than up, borrowers are shopping around for the variable rate deal and avoiding fixed for the time being,” he said.

Victoria, South Australia and Queensland saw refinancing most popular at 42.2%, 41.7% and 39.9% respectively. Western Australia and New South Wales achieved 36.7% and 31.8%.